BAE paid millions into accounts linked to billionaire's bank accounts

28/11/2006 23h54

©AFP/DDP/File - Timm SchambergerLONDON (AFP) - Secret payments worth millions of pounds (euros/dollars) from British defence group BAE Systems have been found in the Swiss bank accounts of Syrian-born Saudi arms dealer Wafic Said, a report said.

Citing unnamed legal sources, The Guardian daily reported that investigators from Britain's Serious Fraud Office (SFO) wanted to investigate Said's accounts to see if he passed along any of the cash to members of the Saudi royal family, and if so, when.

It is part of a three-year investigation by the SFO into claims that BAE established a 60-million-pound slush fund for some members of the Saudi royal family, which allegedly provided perks including luxury cars to ensure that they kept doing business with BAE.

According to The Guardian, 68-year-old Said refused to comment on the allegations. He has previously conceded that he was an intermediary on Saudi arms deals over the past 20 years, and is credited with playing a major role in the Al-Yamamah deal between Britain and Saudi Arabia in 1985.

The deal has been the focus of the SFO inquiry. Said has always denied receiving commissions from BAE.

The Guardian reported that SFO investigators are checking to see if any payments were made after 2002, when Britain passed a law criminalising overseas corruption. The country is also party to an OECD agreement under which national interests are not allowed to block efforts to fight bribery.

Saudi Arabia threatened to suspend diplomatic links with Britain over the affair after SFO lawyers persuaded a Swiss magistrate to force disclosure of details about confidential Swiss bank accounts, this week's Sunday Times reported.

And BAE on Tueday hinted that negotiations between the two countries over the kingdom's purchase of 72 new Eurofighter aircraft have stalled, with a BAE spokeswoman telling AFP that the talks "have not moved at pace" since the end of Ramadan in late October.

The Financial Times reported that Saudi Arabia has gone as far as suspending the talks over the aircraft made by BAE Systems because of a row over an investigation into an alleged slush fund.

The FT had quoted BAE Systems chief executive Mike Turner as saying:

"We cannot speak on behalf of the two governments. But I do know we are not currently moving forward on finalising the Typhoon contract."

BAE Systems has sealed a series of lucrative deals with Saudi Arabia since 1985. The current Eurofighter deal is initially for 10 billion pounds (19.4 billion dollars, 14.8 billion euros), but the value of the agreement could rise to as much as 40 billion pounds for BAE through maintenance and upgrades.

According to unnamed officials from BAE and the British defence ministry, the Saudis are poised to sign a deal with France to buy 24 or 36 Rafale jets, the Financial Times said on Tuesday.

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